DSE Brokers Association Calls for Inquiry Committee on Capital Market Activities
The DSE Brokers Association (DBA), representing brokerage firms of the Dhaka Stock Exchange, has urged the formation of an inquiry committee to review the capital market’s activities between 2010 and 2024. The association also seeks equitable representation in the appointment of directors and a reassessment of the demutualization scheme under the Dhaka Stock Exchange Demutualization Act 2013. A letter outlining these demands was submitted to the finance adviser.
Demutualization of the Stock Exchange
The stock exchange underwent demutualization in 2013, post the Ibrahim Khaled committee’s recommendations following a significant market crash in 2010. The process aimed to separate ownership from management, leading to the inclusion of independent directors on the board for transparency and accountability. However, the DBA argues that the majority of independent directors have resulted in a dominance that has led to a dysfunctional institution since 2013.
Recommendations for Strengthening the Capital Market
To address concerns and improve the capital market’s functioning, the DBA suggests revisiting the demutualization act and scheme. They propose a board with equal representation of six independent and six shareholder directors, with the chairman chosen from the shareholder directors. Restoring investor confidence by forming an inquiry committee to investigate the past 15 years’ market activities is also crucial.
It is vital to note that recent leadership changes at the BSEC have brought about discussions on enhancing regulatory measures and addressing past irregularities in the capital market. Reviewing the existing framework and governance practices is imperative to foster a robust and transparent capital market ecosystem in Bangladesh.
Source : www.tbsnews.net